Senator: White House Will Reject Keystone XL Next Month

After years of politicking, the Obama administration will announce it’s decided to reject the application to build the Keystone XL pipeline during Congress’ August recess, according to a Republican lawmaker.

“What I’m hearing from multiple sources is that he is going to turn down Keystone when we’re out in August,” North Dakota Sen. John Hoeven told Bloomberg BNA’s Ari Natter Tuesday. “I got a couple sources, and that’s what they’re saying. But I can’t tell you who.”

If Hoeven’s sources are correct, Keystone’s rejection is a victory for Democrats and environmentalists who rapidly opposed the pipeline over the last seven years. It’s been a major source of fundraising for environmentalists and lawmakers alike, and also managed to draw in big spending from a San Francisco billionaire who opposed the project.

But Hoeven said the victory will be short-lived for Keystone opponents because Canada will find other ways to bring Albertan oil sands to market — indeed the company is already exploring ways to ship oil to Canada’s eastern coast instead of going through the American Midwest.

Also, Keystone’s southern leg extending from Cushing, Okla., to the Gulf Coast is already in operation. TransCanada, the Canadian company looking to build KXL, recently announced the project’s southern leg had pumped its billionth barrel of oil.

“If indeed these rumors are true with what Senator Hoeven has said today, it’s a victory for our opponents,” James Millar, a TransCanada spokesman, told Natter. “We would simply be making a choice of saying ‘Yes’ to oil from Iran and Venezuela and ‘No’ to oil from Canada and the U.S. Bakken.”

If President Barack Obama actually rejects Keystone XL, it shouldn’t come as a surprise. Earlier this year, Obama vetoed legislation that would have approved the pipeline, which would carry 830,000 barrels of oil sands through the country to refineries on the Gulf Coast. A recent report found the government’s refusal to approve the project for the last seven years has cost the economy $42 million a day.

Obama has also taken jabs at Keystone XL’s economic benefits and urged Canada to do more to lower its contribution to global warming.

“These young people are going to have to live in a world where we already know temperatures are going up, and Keystone is a potential contributor of that,” Obama said on The Colbert Report last year. “We have to examine that, and we have to weigh that against the amount of jobs it’s actually going to create, which aren’t a lot.”

Interestingly enough, Obama’s own State Department has said the pipeline would have an insignificant impact on the environment and create thousands of jobs. The Department is supposed to use such findings to determine whether or not the project is in the national interest, but such a finding has yet to be announced.